Independent Contractor

The Exploding New Gig Economy: States Decide Tough Classification Issues!

The Exploding New Gig Economy: States Decide Tough Classification Issues!

By Nancy E. Joerg of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Independent Contractor on Wednesday, May 17, 2017.

In recent years, many states have passed laws attempting to regulate ride-hailing companies such as Uber (and other members of the “gig economy”). These new laws cover how to treat independent contractors with regard to insurance requirements, recordkeeping, inspections and background checks, etc.

GIG ECONOMY: The term “gig economy” is new and confusing. Generally speaking, the gig economy involves freelance work typically facilitated by an internet platform or app. Its increased use in recent years by all kinds of businesses has started to impact the overall economy. The gig economy can also be understood as any digital platform that allows independent contractors to build their own independent business ventures. Uber drivers, for example, typically aren’t employees but rather independent contractors who use the app to connect with potential clients of Uber.

The independent contractor vs. employee battle continues to heat up, state by state. State legislatures are trying to straighten out these classification issues to either refine existing laws or create new ones (to permit the fast growing “gig economy” to flourish).

NEW FLORIDA LAW: TRANSPORTATION NETWORK COMPANIES ACT: On May 9, 2017, Governor Rick Scott of Florida signed the Transportation Network Companies Act (HB 221), which classifies drivers for ride-sharing companies in the on-demand or gig economy as “independent contractors” (as long as the “transportation network company” meets legal criteria that are currently met by Uber, Lyft, and other similar companies).

For a business dubbed a “transportation network company” in Florida, the new law essentially creates a legal safe-harbor for ride-sharing companies like Uber from liability for misclassification of employees as independent contractors under Florida’s labor and employment laws (including state laws governing minimum wages, unemployment, workers’ compensation, and workplace discrimination). It does so by creating a new four-pronged test for independent contractor status in the ride-sharing industry – a test that is not difficult for ride-sharing companies to meet. The law also creates statewide protections for both the drivers and consumers.

This Florida law is the latest example of a state responding to growing pressure from lawsuits, lobbying efforts by companies, and the consequences of the expanding gig economy. States are crafting new laws to handle these legal issues springing out of the gig economy.

VIEW OF CRITICS AND SUPPORTERS: Critics fear any carve-outs for companies such as Uber will limit the ability of independent contractor drivers to sue for their employment rights. Critics argue that by classifying drivers as independent contractors and not employees, the companies avoid all the responsibility of being an employer and shift the cost of doing business onto the independent contractor drivers (in hopes of avoiding liability for unemployment or workers’ compensation).

FLORIDA’S GIG ECONOMY STILL COVERED BY FEDERAL LAWS: Note that this new Florida law is just a state law. Therefore, it does not preempt or eliminate the federal wage and hour laws and other U.S. labor and employment statutes, which are not affected by this new state law. The legal tests for independent contractor status under those federal laws remain unchanged by this new Florida law.

PRACTICE TIP: All on-demand companies (big part of the gig economy) including those in the ride-sharing industry who rely upon independent contractors should take steps to minimize the likelihood that they will be targets of future claims for independent contractor misclassification. It is an excellent idea for any company which is part of the gig economy to review both state and Federal laws and legal precedent on independent contractor classification issues. Then put good independent contractor practices in place to provide legal protections (in case of a future legal challenge to independent contractor status). Develop and nurture strategies to strengthen independent contractor status.

For assistance with independent contractor hearings or issues or restructuring independent contractor relationships or agreements to reduce risk, contact Attorney Nancy E. Joerg who can be reached at Wessels Sherman’s St. Charles, Illinois office: 630-377-1554 or email her at

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Firm News

Wessels Sherman’s 2017 Employer Empowerment Seminar in Minnesota is Another Big Success!

Wessels Sherman’s 2017 Employer Empowerment Seminar in Minnesota is Another Big Success!

By James B. Sherman of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Firm News on Thursday, May 4, 2017.

Wessels Sherman’s Minnesota office hosted the firm’s annual labor and employment law seminar for employers, accountants, attorneys and other business professionals on April 28, 2017 at the beautiful Radisson Blu, Mall of America hotel. James Sherman, firm President/CEO and Founder/Managing Shareholder of our Minneapolis office, welcomed the room full of attendees who came from four different states and a broad spectrum of industries and fields. After delivering the day’s first presentation on drastic changes taking place in workplace laws and regulations in 2017, Mr. Sherman served as moderator to introduce the many other presenters throughout the day. Special Guest Speaker Nick Rogers, President/CEO of Minnesota’s newest major league sports team (and a lawyer who previously practiced in the private sector), regaled the audience with the fascinating story behind Minnesota United’s mercurial rise from the lower division league, to one of the countries two MLS expansion teams in 2017, to breaking ground on a brand new, privately financed, soccer specific stadium in May of this year. The club’s success story can be an inspiration to businesses of all sizes and industries!

Of course the firm’s attorneys from Minnesota, Wisconsin, Iowa and Illinois, provided attendees with current information and experienced advice on many of the biggest issues in human resources and workplace law, today. Based on feedback from those who attended the seminar, some of the most popular topics presented on included: EEOC guidance on pregnancy in the workplace; ADA accommodations for mental disabilities; intermittent FMLA leave; tips on employee handbooks; ACA update, among many others. In addition to the presentations and valuable materials, attendees received vouchers for free audits of company handbooks and Forms I-9, to help cope with the new administration’s promise of increased scrutiny in certain areas.

Here are just a few pictures from the event, along with some quotes from some of the many satisfied business professionals in attendance at this event:

One attendee even went so far as to issue a real time Tweet from the event, featuring a picture of our Guest Speaker Nick Rogers at the Wessels Sherman employment law seminar. We thought it was pretty cool, as did the Minnesota United F.C. soccer club, who “re-tweeted” the comment, seen below:

Tags: Employer Empowerment Seminar, Firm News

Related Posts: Wessels Sherman Offers a New Service to its Clients – Early Mediation of Internal Workplace Disputes!, On the Lighter Side, SAVE THE DATE: Friday, April 28th, 2017!!!, Wessels Sherman is Pleased to Announce that Allison Wells has Joined our Firm as an Associate Attorney in our Minneapolis, MN Office.

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Employment Policies and Procedures Harassment

Expanding Title VII?

Expanding Title VII?

By Walter J. Liszka of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Employment Policies and Procedures on Tuesday, May 23, 2017.

The Seventh Circuit Court of Appeals’ landmark decision in Hively v. Ivy Tech Community College of Indiana (Case No. 15-1720), which established that Title VII of the Civil Rights Act of 1964 bans discrimination on the issue of sexual orientation, may be an indication that the Courts are willing to adopt much more inclusive positions towards gay workers and may, as well, keep moving in that same direction with regard to transgender employees. It is quite clear from a review of print and social media that LGBT advocates are becoming much more aggressive in the challenging of perceived discrimination in the workplace. Clearly, the Legal Basis behind the Seventh Circuit Court of Appeals Decision in Hively could also be used in future Cases to widen the scope of protection for transgender workers.

What are some of the “practical issues” that Employers may face in the future?

Q: If a heterosexual male refuses to sit next to a gay male or a transgender coworker, should or can the Manager change the seating assignment for any of the employees?

A: The simple answer is “No.” Should the same complaint be made about sitting next to an African American or Hispanic Employee, there would be a clear basis for the refusal of the request and that same situation should prevail here.

Q: Should there be open discussion about a transitioning workers’ situation?

A: Absolutely not. While there should be, and could be, discussion within the Human Resources Department or other Managers with regard to the transitioning employee’s situation, there should be no communication to any other employees until specifically authorized by the involved transitioning employee. This is not a “gossip’s sake” scenario.

Q: Can the Employer who has an established dress code require that the transitioning employee not dress according to their gender identity?

A: Absolutely not. While most Employers have a legal right to set reasonable and gender based dress codes, the Employer must allow an individual who identifies as a male to dress as a male in accordance with the dress code and an individual who identifies as a female to dress as a female. While the Employer could prohibit the transitioning employee from mixing and matching two (2) uniforms (shirt and tie with a skirt), that is one of the few limitations. The individual’s gender identity must determine where they fit in the dress code.

Q: Can the Employer prohibit the transgender employee from using the bathroom of their choice because of employee complaints?

A: As one has seen with the North Carolina scenario purporting to deal with “allowed bathroom use”, this is an area fraught with difficulty. The Employer must allow the worker to use the restroom that matches their gender identity or make available single occupancy unisex facilities. It has long been part of the European culture that individuals of different sex use the same restroom facilities. Just because an individual who is complaining has some discomfort with regard to the facilities use by a transitioning employee, that will not be sufficient to force the transitioning employee to not use the facility.

Certainly time are a’changin and it is becoming more and more complicated to navigate the day-to-day obligations of an Employer vis-à-vis its workforce. It could be that an old bromide has application – treat Employees as you, the Employer, want to be treated – with honesty, fairness and respect!

Questions? Contact Attorney Walter Liszka in our Chicago office at (312) 629-9300 or by email at

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President Trump Appoints MN Supreme Court Justice to the U.S. Court of Appeals for the Eighth Circuit

President Trump Appoints MN Supreme Court Justice to the U.S. Court of Appeals for the Eighth Circuit

On behalf of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Other on Monday, May 8, 2017.

On May 8th President Trump began nominating judges to fill more than 125 existing vacancies in the nation’s federal courts. Among his first 10 nominees following the recent appointment of Justice Neal Gorsuch to the U.S. Supreme Court, is our own Minnesota Supreme Court Justice David Stras, whom the President nominated to a seat on the Eighth Circuit Court of Appeals. Assuming Judge Stras’ appointment is confirmed by the U.S. Senate, he will continue to influence legal issues in Minnesota but on the federal level since the Eighth Circuit oversees the federal courts in Minnesota as well as Iowa, Missouri, Nebraska and North and South Dakota. As would be expected, Judge Stras’s nomination is supported by conservative groups such as the Heritage Foundation and Federalist Society (known for its “strict constructionist” position on how the laws and constitution should be interpreted by the courts). Judge Stras holds several degrees from the University of Kansas, including an MBA and JD. After teaching at the University of Minnesota Law School as an assistant professor, in 2010 then Governor Tim Pawlenty appointed him to a vacant seat on the Minnesota Supreme Court and he won re-election in 2012.

The impact of Judge David Stras on the U.S. Court of Appeals for the Eighth Circuit, in terms of labor and employment cases, remains to be seen. However, despite the fact that if his nomination goes through he will be interpreting federal rather than the state laws and constitution, his conservative leanings and narrow interpretations of the law should bode well for employers. In his roughly 7 years on the bench as a Minnesota Supreme Court Justice, Judge Straus has been involved in a handful of important workplace-related decisions that provide some insight into how he will serve on the federal appellate bench.

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